--
Third straight year of growth in total revenues and orders
--
Total revenues up 41% from 2016

--
New orders of $108 million, up 11% from 2016

--
Significant growth in Thin-film Equipment (TFE) business
--
Revenues up 75% year-over-year, with significant growth in both
new TFE growth initiatives, as well as Hard Disk Drive (HDD)
systems and upgrades

--
Third straight year of improving operating results
--
Return to profitability, with EPS of $0.18 per diluted share for
2017

"As expected, strong growth in our Thin-film Equipment business led to
overall revenues increasing 41% year-over-year, and a return to
profitability in 2017," commented Wendell Blonigan, president and chief
executive officer of Intevac. "The continued technology investments by
our HDD customers helped drive favorable results in TFE revenues, gross
margins and profitability, both for the fourth quarter and for the full
year. 2017 was also a pivotal year for our TFE growth initiatives, with
revenues recognized on the VERTEX and MATRIX, our newest
high-productivity, substrate-independent platforms serving multiple new
end markets outside of the HDD industry. These platforms are gaining
traction and represent significant future revenue growth opportunities
for the Company.

"In our Photonics business, we were successful in capturing new
development programs during 2017. Importantly, we secured funding for
our next-generation night-vision sensor, the ISIE-19. We were pleased to
report the approval of the DELTA-I program under the Department of
Defenses Coalition Warfare Program funded by the DoD, SOCOM and several
foreign nation coalition partners. The DELTA-I program includes a
$12 million funding commitment to complete the design of our ISIE-19
sensor as well as the development of a digitally-fused infrared/night
vision goggle. We were also placed on contract for our integrated night
vision camera on the Striker II helmet for Europes Typhoon aircraft.
Accordingly, we expect our Photonics revenue profile in the near term to
transition from a product-driven one to a funded R&D profile.

"Year-end backlog in our TFE business is up for five straight years, as
we continue to execute against our TFE growth initiatives. 2018 will be
another important year, as we continue to work toward new market
opportunities for both the VERTEX and the MATRIX. Our customers in the
display cover panel market continue to evaluate the VERTEX, and our
oDLC(TM) coating has now been adopted for a top-5 cell phone application.
We also are working with multiple outsourced semiconductor assembly and
test (OSAT) vendors in advanced wafer-level and panel-level packaging to
adapt our MATRIX for fan-out applications. In total, we believe we are
on a path to continue to drive revenue growth and profitability for the
Company."

The net loss for the quarter was $41,000, or $0.00 per diluted share.
This compares to net income of $2.8 million, or $0.13 per diluted share,
in the fourth quarter of 2016. The non-GAAP net loss was $83,000, or
$0.00 per diluted share, compared to non-GAAP net income of
$2.8 million, or $0.13 per diluted share, for the fourth quarter of 2016.

Revenues were $24.8 million, including $17.9 million of TFE revenues and
Photonics revenues of $6.9 million. TFE revenues consisted of two
200 Lean HDD systems, upgrades, spares and service. Photonics revenues
included $2.7 million of research and development contracts. In the
fourth quarter of 2016, revenues were $29.0 million, including
$19.3 million of TFE revenues which consisted of two 200 Lean HDD
systems, one MATRIX PVD solar system, upgrades, spares and service and
Photonics revenues of $9.7 million, which included $2.0 million of
research and development contracts.

TFE gross margin was 45.0% compared to 38.9% in the fourth quarter of
2016 and 45.5% in the third quarter of 2017. The improvement from the
fourth quarter of 2016 reflected a higher mix of higher-margin upgrades
versus systems shipments and improved factory absorption. The decline
from the third quarter of 2017 reflected lower factory absorption.

Photonics gross margin was 26.0% compared to 45.5% in the fourth quarter
of 2016 and 36.5% in the third quarter of 2017. The decline from the
third quarter of 2017 and the fourth quarter of 2016 was due to lower
margins on products and a higher-mix of lower margin research and
development contracts. Consolidated gross margin was 39.8%, compared to
41.1% in the fourth quarter of 2016 and 42.3% in the third quarter of
2017.

R&D and SG&A expenses were $9.7 million, compared to $9.0 million in the
fourth quarter of 2016 and to $10.3 million in the third quarter of
2017. Higher year-over-year expenses reflected increased variable
compensation program accruals. The decrease from the third quarter of
2017 resulted from lower spending on R&D programs.

Order backlog totaled $64.0 million on December 30, 2017, compared to
$72.8 million on September 30, 2017 and $68.5 million on December
31, 2016. Backlog at December 30, 2017 included three 200 Lean HDD
systems and twelve ENERGi solar ion implant systems. Backlog at
September 30, 2017 included five 200 Lean HDD systems and twelve ENERGi
solar ion implant systems. Backlog at December 31, 2016 included four
200 Lean HDD systems, four INTEVAC VERTEX display cover panel coating
systems, one INTEVAC MATRIX solar system, and two ENERGi solar
ion implant systems.

The Company ended the year with $43.5 million of total cash, restricted
cash and investments and $81.2 million in tangible book value.

Fiscal Year 2017 Summary

Net income was $4.1 million, or $0.18 per diluted share, compared to a
net loss of $7.4 million, or $0.36 per diluted share. Non-GAAP net
income was $3.9 million or $0.17 per diluted share, compared to the
non-GAAP net loss of $7.5 million or $0.36 per diluted share for fiscal
2016.

Revenues were $112.8 million, including $79.0 million of TFE revenues
and Photonics revenues of $33.8 million, of which $8.0 million was
contract R&D revenues, compared to 2016 revenues of $80.1 million,
including $45.3 million of TFE revenues and Photonics revenues of
$34.9 million for 2016, of which $5.8 million was contract R&D revenues.

TFE gross margin was 42.7%, compared to 32.8% in 2016. The improvement
from 2016 reflected a higher level of revenue, a higher mix of
higher-margin upgrades versus systems shipments and improved factory
absorption. Photonics gross margin was 35.2% compared to 44.6% in 2016,
reflecting a higher mix of lower-margin research and development
contracts versus product sales. Consolidated gross margin was 40.5%
compared to 38.0% in 2016.

Total R&D and SG&A expenses were $41.0 million compared to $38.1 million
in 2016. The higher level of SG&A expenses reflects increased accruals
for variable compensation programs as a result of the Companys
profitability for the year.

Use of Non-GAAP Financial Measures

Intevacs non-GAAP results exclude the impact of changes in fair value
of contingent consideration liabilities associated with business
combinations. A reconciliation of the GAAP and non-GAAP results is
provided in the financial tables included in this release.

Management uses non-GAAP results to evaluate the companys operating and
financial performance in light of business objectives and for planning
purposes. These measures are not in accordance with GAAP and may differ
from non-GAAP methods of accounting and reporting used by other
companies. Intevac believes these measures enhance investors ability to
review the companys business from the same perspective as the companys
management and facilitate comparisons of this periods results with
prior periods. The presentation of this additional information should
not be considered a substitute for results prepared in accordance with
GAAP.

Conference Call Information

The Company will discuss its financial results and outlook in a
conference call today at 1:30 p.m. PST (4:30 p.m. EST). To participate
in the teleconference, please call toll-free (877) 334-0811 prior to the
start time. For international callers, the dial-in number is
(408) 427-3734. You may also listen live via the Internet at the
Companys website, www.intevac.com,
under the Investors link, or at www.earnings.com.
For those unable to attend, these web sites will host an archive of the
call. Additionally, a telephone replay of the call will be available for
48 hours beginning today at 7:30 p.m. EST. You may access the replay by
calling (855) 859-2056 or, for international callers, (404) 537-3406,
and providing Replay Passcode 6190879.

About Intevac

Intevac was founded in 1991 and has two businesses: Thin-film Equipment
and Photonics.

In our Thin-film Equipment business, we are a leader in the design and
development of high-productivity, thin-film processing systems. Our
production-proven platforms are designed for high-volume manufacturing
of substrates with precise thin film properties, such as the hard drive
media, display cover panel, and solar photovoltaic markets we serve
currently.

In our Photonics business, we are a recognized leading developer of
advanced high-sensitivity digital sensors, cameras and systems that
primarily serve the defense industry. We are the provider of integrated
digital imaging systems for most U.S. military night vision programs.

For more information call 408-986-9888, or visit the Companys website
at www.intevac.com.

200 Lean(R),INTEVAC MATRIX(R),
INTEVAC VERTEX(R), and ENERGi(R), are
registered trademarks and oDLC(TM) is a trademark of Intevac, Inc.

Safe Harbor Statement

This press release includes statements that constitute "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 (the "Reform Act"). Intevac claims the protection of
the safe-harbor for forward-looking statements contained in the Reform
Act. These forward-looking statements are often characterized by the
terms "may," "believes," "projects," "expects," or "anticipates," and do
not reflect historical facts. Specific forward-looking statements
contained in this press release include, but are not limited to:
customer adoption of our products, an increase in the revenue
opportunity pipeline for Photonics, and the future financial performance
of Intevac, such as achieving profitability. The forward-looking
statements contained herein involve risks and uncertainties that could
cause actual results to differ materially from the Companys
expectations. These risks include, but are not limited to: technology
risk and challenges achieving customer adoption and revenue recognition
in Thin-film Equipment markets and delays in Photonics programs, each of
which could have a material impact on our business, our financial
results, and the Companys stock price. These risks and other factors
are detailed in the Companys periodic filings with the U.S. Securities
and Exchange Commission.